Intel’s CEO steps down amid financial woes at US chipmaker

Intel CEO Pat Gelsinger has retired, the company said in a surprise announcement that comes as its financial woes pile up.

Two company executives, David Zinsner and Michelle Johnston Holthaus, will act as interim co-CEOs while the company searches for a replacement for Gelsinger, who also stepped down from the company’s board.

Intel was once a dominant force in the semiconductor industry but has been eclipsed by rival Nvidia, which has cornered the market for chips that run artificial intelligence systems.

Nvidia’s ascendance was cemented earlier this month when it replaced Intel on the Dow Jones Industrial Average.

Gelsinger started at Intel in 1979 at Intel and was its first chief technology officer. He returned to Intel as chief executive in 2021.

Zinsner is executive vice president and chief financial officer at Intel. Holthaus was appointed to the newly created position of CEO of Intel Products, which includes the client computing group, data centre and AI group and network and edge group.

Frank Yeary, independent chair of Intel’s board, will become interim executive chair.

“Pat spent his formative years at Intel, then returned at a critical time for the company in 2021,” Yeary said in a statement. “As a leader, Pat helped launch and revitalise process manufacturing by investing in state-of-the-art semiconductor manufacturing, while working tirelessly to drive innovation throughout the company”.

Intel posts €15.9 billion loss in most recent quarter

The company posted a $16.6 billion loss (€15.7 billion) in the most recent quarter.

Gelsinger announced plans in August to slash 15 per cent of its huge workforce, or about 15,000 jobs, as part of cost-cutting efforts to save $10 billion (€9.5 billion) in 2025.

Last week, it was revealed that US President Joe Biden’s administration plans on reducing part of Intel’s $8.5 billion (€8 billion) in federal funding for computer chip plants around the country, according to three people familiar with the grant who spoke on the condition of anonymity to discuss private conversations.

The reduction is largely a byproduct of the $3 billion (€2.87 million) that the company is also receiving to provide computer chips to the military.

President Biden announced the agreement to provide Intel with up to $8.5 billion in direct funding and $11 billion (€10.4 billion) in loans in March.

The changes to Intel’s funding are not related to the company’s financial record or milestones, the people familiar with the grant told The Associated Press.

Shares of the Santa Clara, California, company, rose 2.6 per cent in morning trading. Its stock has shed 42 per cent in the past year.